By Alex MacDonald
LONDON--Nathaniel Rothschild, one of the founders and major
shareholder of coal miner Bumi PLC (BUMI.LN), said Thursday that
challenges would remain even if the Bakrie family were to exit
their Bumi investment since the remaining shares would still be
concentrated in the hands of a small number of shareholders.
The powerful Indonesian Bakrie family has proposed an exit from
Bumi that would severe all ties with the U.K.-listed company and
Mr. Rothschild. The move would bring an end to a tumultuous period
for the company, during which concerns were raised about Bumi's
corporate governance standards and a probe was launched into
alleged financial irregularities that have focused, among other
things, on PT Bumi Resources TBk (BUMI.LN), Indonesia's largest
coal producer, in which the Bakrie family has a significant
interest.
"As has been noted over the last 12 months, there have been
challenges in implementing appropriate standards of corporate
governance and these have been a source of friction amongst the
board members and shareholders," Mr. Rothschild said in a
statement. Mr. Rothschild owns an 11.9% stake in Bumi, according to
FactSet.
"Even if the Bakries exit, one of the key concerns that I share
with other minority investors is that Bumi PLC would still face a
concentration of ownership by a small number of closely related
parties and such challenges would remain," he added.
The Bakrie family, through PT Bakrie & Brothers Tbk
(BNBR.JK) and Long Haul Holdings, has offered to cancel their 28.4%
stake in Bumi and pay an undisclosed amount in cash in exchange for
Bumi's 29% stake in PT Bumi Resources, one of the jewels in the
Bakrie family's crown.
The Bakrie family, through the Bakrie Group, also proposed
paying cash within the next six months to buy Bumi's 85% stake in
PT Berau Coal Energy Tbk (BRAU.JK), Indonesia's fifth-largest coal
miner.
Mr. Rothschild said he would refrain from making any comment on
the Bakrie offer until an independent investigation into alleged
financial and other iregularities has been concluded.
Write to Alex MacDonald at alex.macdonald@dowjones.com
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